Welcome And Summer Catch-Up

Intro & Outro 0:00

Welcome to Tennessee on Supply Chain Management, where we unpack the drivers shaping today's global supply chain. From innovative ideas to real-world solutions, each episode brings you insights from the leaders charting the course for our discipline. Now here are your hosts.

Tom Goldsby 0:19

Hello and welcome. It's the Tennessee on Supply Chain Management Podcast. I'm your co-host, Tom Goldsby, joined by my good friend and co-host, Dr. Ted Stank. Hey Ted, how are you doing?

Ted Stank 0:32

Hey Thomas, how's it going? I'm doing well. How about you?

Tom Goldsby 0:36

Well, you know, we've gotten the grades turned in. Summer's underway here on Rocky Top. I've already been to Italy and back, just trying to knock out all those summer chores that have been stacking up. What about with you?

Ted Stank 0:49

Yeah, no kidding. Just when I finished grading for the spring, I don't even think I had my grades turned in yet when I had my first class of the summer with our capstone of the Master of Science class. And then we've got a couple of non-degree certification programs running with 3M and with Walmart. So engaged in those as well. I know you are with 3M also.

Tom Goldsby 1:10

Yeah. Yeah. I'm doing Asia Pacific with 3M, which means I get some late nights, but it's good fun, really enjoying that engagement. We hosted Kroger on campus last week. They were here for four days of some really great engagement. So yeah, summer's underway and hoping to get a book project knocked out this summer that's way, way, way overdue. So it's time to tend to those matters. But it's good, all good fun. We had the Savannah Bananas come through town, which brought a little bit of summer excitement to Knoxville. And hey, you know, we were talking with our guest earlier who partook in the Savannah Bananas coming

Meeting Wally Shaw And Red Stag

Tom Goldsby 1:48

to town. What do you say? We go ahead and introduce our guest, Mr. Wally Shaw, is joining us today. Wally is the CEO of Red Stag Fulfillment, a third-party logistics company based right here in East Tennessee, Greater Knoxville. Eric, good morning, Wally. How are you doing?

Wally Shaw 2:04

Hey, Tom, good to see you. Thanks for having me. Hey, Ted. How's it going, Wally? Great to see you.

Ted Stank 2:09

Hey, and Tom, by the way, before you got on, Wally was saying he has an apartment overlooking the stadium where the Savannah Bananas played. It's the home stadium for our Knoxville AA baseball team and One Knox Soccer Club, too.

Tom Goldsby 2:22

That's a pretty good vantage point, eh, Wally?

Wally Shaw 2:24

Yeah, it's pretty good. Living over center field in the bullpen, making fun of folks and having a good time. It was really good. I mean, Savannah's brought the bananas.

Tom Goldsby 2:32

I'm I'm telling you, the Knoxville. Well, that's quite the uh the show. And I have to admit, I I think I was on travel when they were in town, so I didn't get caught up in those festivities, but I did get a pre-notice. Someone who's kind of in their HR group was saying, hey, if you've got any students that wanted to, you know, take tickets and be involved in the organization. And I said, hey, if I was in town, I'd do it myself. But I think it was kind of a soggy weekend when they were in town, but still a good time had by all. That's right. Hey, speaking of good times, uh I'm looking forward to the conversation we have in store. And as I mentioned, uh Wally is CEO of Red Stag Fulfillment. We'll certainly talk about the 3PL space here as well. Also, Wally, I feel I need to call out a couple of things. You're a former neighbor of mine, so it's great to engage with you at that level. Hey, let's go ahead. I got Wally's permission to mention this before we got the recording underway that uh his son Aiden is a major in supply chain management at the University of Tennessee. And and I I even got permission to add this point that he successfully passed my intro to supply chain class. And you went so far as to say he he got a top grade in the class. So uh congratulations to you. Congratulations to Aiden. And also he's had some fun and excitement already this summer. Is that right, Wally?

Wally Shaw 3:55

Yeah, that's right. Uh Aiden's enjoying supply chain, he's enjoying the University of Tennessee. He's third generation volunteer and he's second generation supply chain major at UT. When I went there, it was called logistics and transportation, though. When I was there with Dr. Langley and Dr. Holcomb as my uh advisors and go to. But he already went to Greece this summer and did the international program with 19 other students and really had a blast. Uh learned a lot. They went to various different factories each day to see how different products were produced, and went to the port to see how products were imported and exported, and then went to a distribution center to see how all of that works. So a lot of good skills learned and seeing how the value chain in action over in Greece. Pretty cool.

Ted Stank 4:37

Yeah, that's pretty spectacular. When you think about it, he started Tom's class in January, which was his first formal introduction to supply chain. Of course, he lives in a supply chain household. So I don't know about you, but when my kids were growing up, I was like, you see that distribution center, that's supply chain in your life. So they were indoctrinated. Yeah, think about the learning curve. He's come up since January, having formal education and now seeing it all in a global setting. It's pretty amazing.

Wally Shaw 5:04

Yeah, it's pretty amazing. He's a special kid, I'm super proud, but really proud that he's at my favorite university and the best supply chain program in the country, at least for sure. Amen to that.

Tom Goldsby 5:17

That's so cool. Hey, Wally, maybe a bit of an introduction for our listeners that aren't familiar with Red Stag Fulfillment, who you are and where you operate out of.

Building A 3PL For Bulky Goods

Wally Shaw 5:28

Yeah, absolutely. So Red Stag Fulfillment was founded 13 years ago because someone had a problem in distribution. Our two founders are also UT graduates, local to Knoxville. They had a big, heavy, bulky business and just weren't getting the service that they thought they needed andor deserved. And out of that, they ultimately created Red Stack Fulfillment, rented a building, kind of figured it out, developed their own WMOS warehouse management operating system in-house in order to make sure they had the technology to support their business. And 13 years later, we're a thriving business that does D2C, B2B delivery. We're based in Knoxville, Tennessee. We have a campus in Sweetwater, Tennessee. For those that aren't in East Tennessee, it's about 30 miles south of Knoxville. And then we have a West Coast facility in Salt Lake City. So that way we can split with the geography of the United States and we can fulfill based on different zones in the D to C market. And then for B2B, we can obviously make sure that we can cover all the retail fronts and the commercial buildings that we have to ship to.

Tom Goldsby 6:31

Excellent. Very good. You know, and I've been on the receiving end of some product that was fulfilled by Red Stag when I got my paddle board some time ago. That's true. And I think you all specialize in that kind of hard-to-handle merchandise. You mentioned direct to consumer, and that's right. Again, I was a consumer in that transaction, delighted that everything arrived on time, complete, in great condition. And that's a unique kind of space in the 3PL, right? I mean, you do a lot of bulky and heavy and these sort of things that maybe a lot of other folks aren't so eager about it or take.

Wally Shaw 7:08

And non-conveyables, that's exactly right. So Big Heavy Bulky BHB, as we shortened for is kind of the niche that was developed originally back to our founding group because no one wanted to touch it. Even if you look at some of the carrier networks, they don't like things that are over 60 pounds because of OSHA rags and different things. You have to double team lift, lift it with two people, all of those things. They also take up a lot of cubic space. Um, they can be very awkward to touch. You can't put them on a conveyor, as Ted said, a lot of times. So navigating that world created a moat for us that kind of insulates us with the opportunity to fulfill both a brand need and a consumer need to make sure that it delivers well to people's home.

Ted Stank 7:52

You know, while one of the things that I have lectured on for my entire career has been the understanding that not all customers are the same, not all products are the same, different values, and therefore segmenting the way you develop your supply chain for those different segments. And I think you guys are a uh perfect example of that. Now, you do have the benefit of being private. Uh I love some of the things that you've said in some of your posts that you know you guys are not focused on growth at all costs. Um, you ought to be able to turn away customers if they don't really fit your model, and and that's something that I really admire. Talking about classes, uh I am proud to say that I think about a hundred years ago I had Jordan Mollenauer in that intro to supply chain class. And then I think he also attended one of our one-week executive programs that I had him in.

Wally Shaw 8:40

So yeah. Jordan is the the consummate learner. He's probably one of the most educated people I've ever met, and that's not me pandering to my boss, if you will, from that standpoint. And and I think you see that in the culture that was built and kind of the the way that it was designed. It is a learning organization, and we just want to continue to get better from that standpoint, and I think Jordan embodies that.

Service Guarantees And Zero Shrink

Ted Stank 9:03

One of the things that really stands out if you just do a little bit of homework on Redstag is the fact that you have service guarantees that if you are late, if there's any kind of damage, if you have uh, you know, some missing parts, you have guarantees of not just making good on it, but actually paying some penalty to a customer for it. Could you expand on that?

Wally Shaw 9:26

I think that's Yeah, absolutely. It is something, you know. I've been doing this for 28, going on 30 years, I guess, now, since I graduated and worked in supply chain. I always would negotiate a shrink tolerance down to the lowest level I could. You know, industry norms about 2%. You're allowed to lose 2%. And we have the mentality: why is it okay to lose any of your stuff? If you're a brand, you should expect that someone's gonna care for it like you would. And if you're gonna turn it over to a third-party logistics provider, you should have that. If we break it in our warehouse, we're gonna pay you back for that. We're also gonna make sure, based on the service level guarantee, that if your same-day ship or your next day ship or whatever terms that you want, that we make sure it gets on that carrier truck on time for that SLA. If we miss any of those, then we have a payback that we give you, whether it's cost of your product or we find ourselves, unlike what a retailer would do, we find ourselves and say, we didn't ship this today on time, we're gonna pay you back. What would effectively be the cost of your shipment?

Ted Stank 10:31

And without becoming too much of a supply chain geek on this issue, that is so powerful to me. And I know this resonates with Tom as well, because another thing we've been preaching our whole careers is that increasingly the value doesn't come to a consumer just from the product, but from the service you wrap around it. I have had some examples of companies that are supposedly consumer-centric that have failed miserably in the delivery, like delivering flowers to my wife on our anniversary that come in three days late, and I try to get reimbursement from them, and they're like, no, you know, that's not our fault. And I'm like, the only reason why I ordered your flowers, there's nothing special about your flowers. I wanted them to arrive for my wife on our anniversary. And so that concept that the service wrapped around a product that sounds nothing new, but not many companies actually execute on it.

Wally Shaw 11:22

That's right. And we do think that that's a differentiator for us that makes sure that services first and what you're gonna get in terms of delivery. And again, when you're talking about big, heavy, bulky, it is different from a $2 item. Most of our items at cost are, you know, tens of dollars or hundreds of dollars, whatever you want to associate with it. So replacing it is more complicated and more costly. So it drives that culture of care and thoughtfulness throughout every process so that we're not just slinging product around. We're we're being thoughtful about what we do.

Ted Stank 11:54

Like, you know, when I when I order a $10 product from Amazon, if it doesn't come or it's late, that doesn't happen often. But when it does, their approach is, okay, fine, we'll just reimburse you and send you a new one. And you can't do that with your product. Well, you could, but you go out of business pretty quickly. That's right.

Tom Goldsby 12:10

But I'm I'm thinking that stat that you threw out there, Wally, 2%, accepting 2% shrink, loss, and damage, and how much we're fighting tooth and nail for every basis point of margin right now. And so that's that's really powerful.

Returns Strategy And Value-Added Work

Tom Goldsby 12:25

Hey, in addition to large, bulky, heavy, you all seem to also take a lot of care around returns management, returns processing. And that's something we've been studying very intensely here at the University of Tennessee. And it's also something we're finding that there's that intent to serve what I call the diabolical consumer. And what do you know? When we're diabolical as consumers, a lot of that product's gonna come back. How do you all kind of step up to help and offer a value proposition on the reverse flow of things?

Wally Shaw 12:57

Yeah, no, that's a great question. Returns are not people's favorite thing, as you'd imagine, both from a consumer and from a brand. So where we really tried to add value is in that kind of value-added services area. Can we evaluate the product? Is it something that you could sell as a B class good, meaning used or renewed in some way? Can we go and take warranty parts out of the product once it's returned? So trampolines being big, heavy, bulky. We ship a lot of trampolines, more than you would ever imagine, in fact. But what we'll do is we can also take the springs off of those trampolines, or we can take off different parts, and then they use them for warranty repair. So there's different types of components that we can go and do, or we can go and do specialized packaging to deliver so that we wouldn't deliver flowers, Ted, but if we were delivering something to your home and you wanted to customize it for your wife, we could do some type of specialization.

Ted Stank 13:49

So you have some value-added service locations in your DCs.

Wally Shaw 13:53

That's correct. Yeah. So we have dedicated returns locations, and it's next to our kitten operations as well, just from a sensitivity of flow in the building and how we partner together those kind of couple of activities that are a little different from the general flow of a logistics setup. So we can do both kiting, we can do some repair, um, and we handle all returns.

Tom Goldsby 14:16

Yeah, very cool. Well, hey, Wally, thanks for that introduction to Red Stag. I'm fascinated. It sounds like you all are willing to take on some of the stuff that your competitors don't want to touch or they're not very adept at. So that's really cool. And you invoked uh Dr. Langley, John Langley, a little bit earlier as one of your favorite profs from back in your days at UT. And we are so proud that he has rejoined the UT faculty as emeritus faculty member in our supply chain department. And something he's brought

AI Hype Versus Real Warehouse Value

Tom Goldsby 14:46

back with him is the annual 3PL study. And so we're so excited to put some orange on that study where I think it belongs. Let's talk about the broader kind of 3PL space. I think based on your comments, you kind of spoke about how Red Stack differentiates yourself in that space. But what are some of the major issues that you're seeing? Uh, what are the things we need to undertake in that 3PL study? What are some of the major forces at work?

Wally Shaw 15:12

Yeah, I mean, the the number one topic de journey is AI. Right now, I think that people just use it a little bit flippantly, to be honest, where I went to a trade show a week or so ago and agentic AI was plastered over every single booth that you went by, but I don't know that anyone knew what it actually meant from that standpoint. And not to be cheeky or jaded, I think it has a really good place of what's going on, but AI is the number one topic. I think that what people are underestimating is the capability gap below the AI in order to make it operate the way that you want and to get real value from implementation of AI is one of the things that we're all trying to figure out. We see real value in testing and speeding up testing for releasing of code, for developing of reports on short notice, for standardizing routines in terms of customer service ticket management and things like that. And then you progress into, you know, some automation from conveyance and automation for robotics that are going to be coming in the warehouses more and more. It's a little bit trickier for heavy stuff because they haven't gotten robots that pick up 200-pound trampolines yet. But I think it's kind of in that order in terms of what's going on with AI. And then you also have the whole thing with tariffs and what's going on with the Iran conflict and different things there, and whether people want to spend money on inventory or advertising and how they want to spend their money and how much inventory that they're putting into their networks to prepare for what the economy is or is not going to do, I think are probably the two biggest topics.

Ted Stank 16:42

Wally, are are your TCs predominantly flow-through where consumers are buying directly from the brands and then you're managing the flow through? So you you don't have a lot of working capital investment in inventory, right?

Wally Shaw 16:55

That that's correct. We are 100% flow through in terms of that business. So we're dependent on the brand and their promotions and their infrastructure setup and where they source their stuff from from Asia and how it comes to the back dock and what type of packaging, all of that has consequences to our setup.

Ted Stank 17:12

I would imagine there's all different ways and and geographic locations that you take uh possession of the goods, including international.

Wally Shaw 17:20

That's right. Most of the stuff is coming from the Far East, as you would imagine. The typical places, China growing um from Vietnam, as you would imagine, as well. And then you do see some stuff from Mexico and and we do have domestic, but uh most of the product is still coming from the Far East.

Ted Stank 17:36

So do you also do international freight brokerage and stuff like that?

Wally Shaw 17:39

We have partnerships with groups that do that for us. And so we have partners that do both import, export. We also have uh custom brokerage, and we have Dre partners that we work with if you need to do something internally as well.

Tom Goldsby 17:54

Well, Wally, I'm thinking that you probably had a front row seat, you know, as the tariffs were being introduced early last year, and we're talking about how trade was shifting. And I think it was we were having a beverage maybe uh one evening when we were together, and you're talking about seeing some interesting shifts

Tariffs Drive Sourcing And Routing Shifts

Tom Goldsby 18:12

in where product was coming from. Can you kind of comment on in general and where that stuff's uh shifting?

Wally Shaw 18:17

Absolutely. So after Liberation Day last year, which was in April, um, we did see uh an immediate lull. People just stopped because they wanted to see is this going to be a short, medium, or long-term event. So we did see inflow slow down andor stop pretty quickly. So kind of coming into May and June, we saw the lull before the storm from that standpoint. What we also saw was as stuff was on the water, again, understanding comes from the Far East, we saw people directing a lot of stuff to the West Coast. They just wanted to get it in because again, they were going to stop behind it. So they wanted to make sure that I had inventory available. They would ship what I would call out of sphere. So being in Salt Lake, but it really should ship from Tennessee, they would go ahead and take that at incremental cost just to make sure they had goods and they could meet the need that they had. So we saw a big bump in growth unforecasted into our Salt Lake facility, but that was just a direct reaction to what was going on in the geopolitical world at the moment.

Tom Goldsby 19:17

And I think you even introduced Cambodia.

Wally Shaw 19:19

Yeah.

Tom Goldsby 19:20

It's right in some products shipping to maybe some some less obvious locales with country of origin. Is that right?

Wally Shaw 19:27

Yeah, that's right. Cambodia is a harder new topic. I was at Phillips for almost 20 years. I mean, we started investigating Cambodia about 10, 12 years ago, moving from southern China down to uh Vietnam and Cambodia. Their infrastructure was a little rough. It's a little dated information, but we are starting to see some product go down into that region.

Ted Stank 19:48

Then when the Supreme Court struck down the tariff architecture, did you see a shift again or is everybody just kind of waiting?

Wally Shaw 19:55

Yeah, we did see a shift again. Uh and we do, because we're close with our clients, as you would imagine, with service being a paramount thing for us, we hear that uh people are getting returns on their tariff refunds. So we do know of a couple of clients who have shared that with us, which hopefully will reinvigorate inventory um and manufacturing from that standpoint and build, but we have seen a resuming of volume coming back in since some of that's receded.

Ted Stank 20:23

What are your expectations on peak season this year? You know, last year everything was early because of what you talked about with the tariffs. You expect similar, or are we gonna have more of a traditional peak season?

Wally Shaw 20:34

I think we're gonna have more of a traditional peak season from what we're seeing. Overall, Redstag is doing well based on our client accretion, but I think we just pour that forward in terms of when we make our forecast for peak, but we think it's gonna be more traditional peak. Thanksgiving's a week, it's not a week early. It's early like it was last year, so it's not the last week of November. So that always does a little bit of dynamics because it creates a little separation between then and Christmas slash Hanukkah for the season. Um, but I think it's gonna be a more standardized holiday this year, uh, barring any other political or geopolitical environment.

Ted Stank 21:12

There's a couple of topics that I want to dive into. One of them is you know, your focus on execution uh strategy is great, but if you can't execute on it. So I'd love to get your take on what some of the things are that you do execution-wise that differentiate you. But before I do that, you just brought up that you worked for Phillips. I know that you had spent most of your career on the shipper side, and I think a lot of your senior leadership at Red Stack come from the shipper side. How does that kind of change your perspective from you know from your competitors in 3PL?

Wally Shaw 21:43

So I've been working, as I said, 28 years solid, going on 29, and 26 of those I was on the brand shipper side. So it was a pretty big change to come to this side, but I think it gives a good insight to me and to our team about what. Customers expect. I always think whenever I'm talking to our customers and on the commercial side of our business, what do they actually need, or what are they trying to ask me, or what would I want if I were in their shoes? And so I think it's a great combination now being on the service side of that and understanding what did I want, what did I have problems with, and trying to drive it. Um and I think that's what I was hired to do

Peak Season Expectations And Forecasting

Wally Shaw 22:24

here, to not have someone who just traditionally ran buildings my whole life. I was in manufacturing, I had procurement report to me, I've had IT, I've had quality, I've lived in five countries, but I've always been on the shipper's side. So bringing those different dynamics, I think, really kind of helped us at Redstag really take the tone of brands first and making sure that we serve some of them that way.

Ted Stank 22:49

I could definitely see where that impact your zero shrinkage perspective and customer-centric perspective across the board. For sure.

Tom Goldsby 22:58

Yeah, and it also occurs to me something my friend Robert Martachenko would always remind me about is that, you know, when you're shipper, logistics is so often regarded as a cost, and when you're a service provider, hey, that's revenue. He always thought it was more exciting to be associated with the revenue side of a business than the cost side of the business. How have you made that kind of transition in terms of what you understand how value is created, but also how value is sold?

Wally Shaw 23:22

So, Tom, to answer your question about where the value is created, I think it's about focusing on products and delivery services per brand. And I think that's where 3PLs can get themselves into danger. And Ted even talked about it a little bit in the intro. I think RedStack has been focused on how do we make sure that we're focused on products that we know how to handle, that we understand your product, that we know what your consumer wants. And that's rooted in our culture. So for us, it's really about not trying to be something that we're not. I will tell you, we get lots of leads every month and we turn them down because we can't do their business effectively, or we don't think we'll do a good job. And I'd rather do a really good job. Apparel is a good example. We don't ship apparel because we wouldn't be good at it. It's high sortation, it's very low labor content, and the setup needs to be totally different than our buildings are. So taking that in, thinking that you can make a couple of points of margin is just not the right business decision for us as a brand. And once you make a consumer mad, it's hard to get them back to the brand. So it would be doing a very big disservice in terms of what we would deliver.

Tom Goldsby 24:32

That's such a provocative notion. And I see Ted nodding in agreement, but the idea of introducing the word no and this notion of customer selectivity, because you know, so many folks in the service sector are just kind of clamoring for any piece of business, any any market share they can gain. And and that's really a fascinating point to say, hey,

Shipper Mindset And Turning Down Business

Tom Goldsby 24:55

we need to understand our business, our capabilities, and where we can deliver that value, and yeah, maybe push off some business that we could otherwise absorb.

Ted Stank 25:02

And well, at the risk of at the risk of angering so many of our partners that are publicly owned. My experience over my now 36 years in this business has been that the companies that to me have done the most impressive things with supply chain management tend to be privately held because you only have a couple of owners that you have to really impress, and you don't have that quarterly pressure to to grow and deliver to the financial markets. So I think that that's a really big reason. So credit to your owners that that aren't over your shoulder saying, you know, we need to grow at 10 percentage points a year.

Wally Shaw 25:40

Yeah, it's all about the long-term investment for our business, and it really is. As we go to add more buildings, as we go to do more business in different areas or geographies, it's all about return on invested capital. It's the conversation that we have. And then what's the payback period and and what threshold do you want to meet? It's not about did we make a month or did we make a quarter, which I have 20 years of experience in. It's the reason I'm not with a public company for the last 10 years because I do personally seek that out, but I found a winner in this company and really being focused on long-term attainment of value and driving value for brands.

Ted Stank 26:20

Yeah, I'm I'm too old now for anybody to want me, but I always thought that if I was going to leave academia, I would go work for one of the private companies that we have great partnerships with.

Tom Goldsby 26:29

You know, it seems I'm I'm picking up a theme for those regular listeners to the Tennessee on Supply Chain Management Podcast. We have these guests like Wally that come on, talk about fun and exciting stuff that they're doing in industry. And Professor Stank talks about jumping on board with him. So, hey, Wally, we we got a non-compete going here as far as you're concerned. Don't don't take our uh senior most professor from alma mater, all right? So uh there's something we're we're we're getting to be pretty protective of Professor Stank and his time these days.

Ted Stank 27:00

Yeah, I'm too old and feeble anymore. Nobody wants me.

Tom Goldsby 27:03

Hey, but let's talk about the talent that we do welcome you uh to take on. That you all do recruit out of our program and I'm sure some other places as well. But as you were talking about major forces, you started right off with AI, right? You said you were at that trade show recently. I think that was home delivery world. Maybe you went. It was.

Wally Shaw 27:23

Yep.

Tom Goldsby 27:24

Yeah, and and in terms of bringing folks into your organization and creating that value for customers that you're talking about, value for the organization. What are you looking for in that talent that you onboard and how is it maybe a little different now than maybe even a few years ago?

Wally Shaw 27:40

Yeah, it's it's worlds different, to be honest. They're just curious and wanting to learn. We have two UT supply chain majors as interns this summer. And really what we're trying to get them in is to see how can we gain efficiency and how can they be involved in the business in terms of owning something. A specific example would be like how do we automate some more of our reporting on the floor? Because I'm a big believer in the Gimba principles of going where the action is and making sure that our supervisors and our operations managers are freed up to coach and to find shortcuts and efficiencies and benefits and ways to keep our team more safe and things of that nature. I want to spend less time on making reports and I want more time on analyzing and spending time with our teammates. So, what we're gonna use our supply chain interns this summer for is how do we make routines? Routines you can then automate and or use AI in order to make sure that you speed things up. So we're gonna allow them to be a part of the business and see what we should be measuring, what are we measuring, and how do we measure it faster? So I think that's the best way that we can do it. But I actually had a one-to-one or a group setting with our interns last week, and the session was just about ownership and accountability. Those are part of our cultures and part of our values here. And we were talking about what makes a successful person postgraduate, and it was really about the ownership that you have when things go wrong. And we went through scenarios and talked about that and said, hey, it's okay to learn, it's okay to make mistakes, but owning that and what you do from there is what's really going to make a difference to an employer. So trying to coach them up, they have to be young men in this case, but coaching up these young talents to make sure that they know what they're getting themselves into. And it starts with ownership and accountability and this curious nature on how to learn in this AI fast-moving world.

Tom Goldsby 29:37

I think what a great experience it is as well for these interns to have a seat with you as the CEO and the opportunity to understand, you know, the values of the organization and how they can contribute meaningfully to the business as interns and uh conceivably coming into the organization down the road. Just a great experience.

Ted Stank 29:58

I'll tell you one of the things that has amazed me throughout my career is to see how kids change. And I say kids loosely, but so you know, what junior year when you have them and they haven't done an internship and then you get them back senior year and you see how much they've changed by having spent a summer in industry and having conversations with people like you. It's really impressive. Let me ask you this. You've been onboarding new talent for a long time. Everybody talks about these generational differences. Do you see a big difference between people coming into your organization today from, you know, 20 years ago?

Wally Shaw 30:31

I do see a difference, but the difference is really about technology adeptness and being prepared to go and do it. I mean, that's just the way that they grew up. If I take my son as the example, he grew up with a computer in front of him. I had to take a typing class to date myself, right? Um in high school, it was a mandatory class. Worst class, worst grade I ever got in high school, I think, was right. We we had to learn how to do those things. But they already are more efficient and more proficient at what they do. So that's it. From the standpoint of worth ethic, I think that's about your values and your structure and and how you are as a makeup of a person. I don't really buy into some of the

Hiring For Ownership And Culture

Wally Shaw 31:12

the nuances that you hear about that, but the adeptness to technology, there has been a change in the last generation for sure.

Ted Stank 31:18

Yeah. My feeling on having them in class for for years and years has been that there's far more commonalities across generations than there are differences. There are some significant differences, but I could see myself, if I were 20, falling right in with a lot of the kids that I have in class. Yeah, totally. And I do think that things like AI and use of AI, I think, is going to be almost a bottom-up type of approach. You know, our hourly employees and our and our line level folks are going to be the ones teaching us about what we might be able to do with it, as long as we give them the right tools and lead with it.

Wally Shaw 31:53

Well said. I think that the culture that we breed with the teammates that are on the floor or hourly teammates that go and drive it is the most important thing. I mean, culture is what drives organizations. You can put together processes, you can put together systems, but it goes in that order. It's people process and then systems. If you don't have the people in place that want to be there and want to learn and want to get better, you're already going to have challenges. And then the processes will support what you need to do, and then systems are the icing on the cake.

Tom Goldsby 32:24

Hey, I think what a perfect way to wrap up this podcast with that message. Wally, thank you so much for delivering that and your time with us today. And it's always great to spend some time with you, and we appreciate you bringing it to the Tennessee on Supply Chain Management Podcast. And with regard to the message he was delivering there with regard to people, process systems. Hey, we've got some exciting programs out there about how you can develop your talent, your people. Uh supply chain management academies are taking enrollment

People Process Systems And Closing

Tom Goldsby 32:55

for the fall. And I believe Ted Stank and I are going to be uh co-directing the uh the Leadership Academy, but we've got a whole host of other academies in procurement, finance, uh we've got a technology academy that's kicking off, right? So a lot of great academies. Please go out if you're interested in developing yourself or developing talent in your organization. These are eight to 14-week courses delivered remotely wherever you are in the world. You can plug into what we're doing here on Rocky Top. So we appreciate that. And hey, with regard to reaching us at any point in time, if you have any questions, ideas, please direct them to us at gscii at utk.edu. And uh, Ted, what do you say? Do we get back to resumption of summer?

Ted Stank 33:38

Uh I think we got to get back to sports. We've got NHL finals, we got NBA finals, we got the World Cup kicking off here. It's just a sports lover's dream right now.

Tom Goldsby 33:49

It really is. Some exciting finals going on. And yeah, I need to wake up to this World Cup. I guess it's coming, right?

Ted Stank 33:54

Uh it starts on Thursday, I believe.

Tom Goldsby 33:56

Wow. Wow. Okay. The world's coming to North America. Here we go. Well, hey, Wally, thank you again so much for joining us today. And uh with that, we'll close out. And uh again, stay tuned for our regularly scheduled podcast, one a month. And again, don't forget to reach us here at gscii at utk.edu. And with that, we'll sign off for summer.

Intro & Outro 34:19

Thanks for listening to Test D on Supply Chain Management. Be sure to subscribe on your favorite podcast platform for more conversations with the leaders of framing the path for practitioners, scholars, and students. Have a question or idea? We'd love to hear from you at gscii at utk.edu. Until next time, listeners.